- Planet42, a South Africa-based car subscription company, has raised $16 million (R300 million) in local-currency debt and equity funding from Standard Bank to repay costly euro-denominated loans.
- The recent funding comes a year after raising $100 million in equity, credit facility, and debt. The company has so far raised approximately $150 million.
Planet42, founded in 2017 by two Estonians, Eerik Oja and Marten Orgna, assesses a prospect's credit risk using algorithms and data points before making a rent or buy offer. The company does this through a subscription model.
The company reports that it receives over 60,000 applications for its vehicles monthly. According to the company, its South African dealers increased their sales by an average of 26% last year. Also, it stated that demand for its services is increasing, resulting in a 37% revenue increase in 2023.
Furthermore, Planet42 claims to have purchased more than 12,000 vehicles for customers in South Africa and Mexico. In 2023, it raised $100 million to scale operations in these two countries.
The investment included $15 million in equity from shareholders, including Naspers Limited, $10 million in debt, and a $75 million credit facility from Rivonia Road Capital. Meanwhile, following the funding, Naspers closed its South Africa-focused technology investment fund, Foundry, but maintained its investment in startups.
In 2021, the company raised $30 million in equity and debt, including $6 million in equity and $24 million in debt financing. Also, in 2020, the company secured $2.4 million in a seed round and $10 million in debt in June and December.
In an interview, the company's CEO stated that it is "super expensive" for a business in South Africa to operate without a local currency-based debt and confirmed that the firm "has had no rand-based debt so far."
“This is a first step to a bigger strategic partnership for us with Standard Bank,” he affirmed.
Planet42's competitors in the industry include Autochek and Moove, which focus on ride-hailing cars and provide similar services in parts of sub-Saharan Africa. However, Autochek, like Platnet42, targets private individuals. Meanwhile, in February 2024, Moove raised a debt funding of $10 million from Stride Ventures, a sector-agnostic venture debt fund.
These companies operate in a market worth $119.28 billion in 2021, with a projected value of $223.07 billion in 2027.
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